EX-10.1






Exhibit
10.1

Execution Version




TRANSITION SERVICES AGREEMENT




by and between




THE E. W. SCRIPPS COMPANY




and




SCRIPPS NETWORKS INTERACTIVE, INC.




Dated as of July 1, 2008




 









 





TABLE OF CONTENTS




	 	 	 	 	 
	 	 	Page	 
	ARTICLE I DEFINITIONS
	 	 	1	 
	 
	 	 	 	 
	SECTION 1.01. Definitions
	 	 	1	 
	 
	 	 	 	 
	SECTION 1.02. General Interpretive Principles
	 	 	6	 
	 
	 	 	 	 
	ARTICLE II TRANSITION SERVICES
	 	 	6	 
	 
	 	 	 	 
	SECTION 2.01. EWS Scheduled Services
	 	 	6	 
	 
	 	 	 	 
	SECTION 2.02. SNI Scheduled Services
	 	 	6	 
	 
	 	 	 	 
	SECTION 2.03. Additional EWS Scheduled Services
	 	 	6	 
	 
	 	 	 	 
	SECTION 2.04. Additional SNI Scheduled Services
	 	 	7	 
	 
	 	 	 	 
	SECTION 2.05. Scope of EWS Services; Standard of Performance for EWS Services
	 	 	7	 
	 
	 	 	 	 
	SECTION 2.06. Scope of SNI Services; Standard of Performance for SNI Services
	 	 	8	 
	 
	 	 	 	 
	SECTION 2.07. Personnel Providing Services; Subcontracting
	 	 	9	 
	 
	 	 	 	 
	SECTION 2.08. Interruption of Services
	 	 	9	 
	 
	 	 	 	 
	SECTION 2.09. Disaster Recovery and Business Continuity
	 	 	10	 
	 
	 	 	 	 
	SECTION 2.10. Transition of Responsibilities
	 	 	11	 
	 
	 	 	 	 
	SECTION 2.11. Insurance
	 	 	12	 
	 
	 	 	 	 
	ARTICLE III FEES AND EXPENSES
	 	 	12	 
	 
	 	 	 	 
	SECTION 3.01. Fees and Expenses
	 	 	12	 
	 
	 	 	 	 
	SECTION 3.02. Billing and Payment; No Set-off
	 	 	12	 
	 
	 	 	 	 
	SECTION 3.03. Third Party Vendor Costs
	 	 	12	 
	 
	 	 	 	 
	SECTION 3.04. Additional Costs
	 	 	13	 
	 
	 	 	 	 
	SECTION 3.05. Late Payments
	 	 	13	 
	 
	 	 	 	 
	SECTION 3.06. Tax Matters
	 	 	13	 
	 
	 	 	 	 
	ARTICLE IV TERM; TERMINATION
	 	 	14	 
	 
	 	 	 	 
	SECTION 4.01. Term
	 	 	14	 
	 
	 	 	 	 
	SECTION 4.02. Force Majeure Event Early Termination of Services
	 	 	14	 
	 
	 	 	 	 
	SECTION 4.03. Early Termination of this Agreement
	 	 	14	 
	 
	 	 	 	 
	SECTION 4.04. Sums Due
	 	 	14	 
	 
	 	 	 	 
	SECTION 4.05. Effect of Termination
	 	 	15	 
	 
	 	 	 	 
	ARTICLE V THIRD PARTY RIGHTS
	 	 	15	 
	 
	 	 	 	 
	SECTION 5.01. Third Parties and EWS Services
	 	 	15	 
	 
	 	 	 	 
	SECTION 5.02. Third Parties and SNI Services
	 	 	16	 






 









 







TABLE OF CONTENTS




	 	 	 	 	 
	 	 	Page	 
	ARTICLE VI INTERNAL CONTROLS
	 	 	16	 
	 
	 	 	 	 
	SECTION 6.01. Access Rights of SNI
	 	 	16	 
	 
	 	 	 	 
	SECTION 6.02. Access Rights of EWS
	 	 	16	 
	 
	 	 	 	 
	SECTION 6.03. Procedures
	 	 	17	 
	 
	 	 	 	 
	ARTICLE VII TRANSITION TEAMS/SINGLE POINT OF CONTACT
	 	 	18	 
	 
	 	 	 	 
	SECTION 7.01. Appointment of Transition Teams
	 	 	18	 
	 
	 	 	 	 
	SECTION 7.02. Transition Team Actions
	 	 	18	 
	 
	 	 	 	 
	ARTICLE VIII CONFIDENTIALITY; NON-SOLICITATION; RECORDS; ACCESS
	 	 	18	 
	 
	 	 	 	 
	SECTION 8.01. Confidentiality Obligations
	 	 	18	 
	 
	 	 	 	 
	SECTION 8.02. Non-Solicitation
	 	 	20	 
	 
	 	 	 	 
	SECTION 8.03. Records
	 	 	21	 
	 
	 	 	 	 
	SECTION 8.04. Access
	 	 	21	 
	 
	 	 	 	 
	ARTICLE IX NO WARRANTY; LIMITATION OF LIABILITY;
	 	 	22	 
	 
	 	 	 	 
	SECTION 9.01. Warranties and Disclaimer of Warranty by EWS
	 	 	22	 
	 
	 	 	 	 
	SECTION 9.02. Warranties and Disclaimer of Warranty by SNI
	 	 	22	 
	 
	 	 	 	 
	SECTION 9.03. Obligation to Re-perform EWS Services
	 	 	23	 
	 
	 	 	 	 
	SECTION 9.04. Obligation to Re-perform SNI Services
	 	 	23	 
	 
	 	 	 	 
	SECTION 9.05. Limitation of Liability
	 	 	23	 
	 
	 	 	 	 
	SECTION 9.06. EWS Indemnity
	 	 	23	 
	 
	 	 	 	 
	SECTION 9.07. SNI Indemnity
	 	 	24	 
	 
	 	 	 	 
	ARTICLE X DISPUTE RESOLUTION
	 	 	24	 
	 
	 	 	 	 
	SECTION 10.01. General
	 	 	24	 
	 
	 	 	 	 
	SECTION 10.02. Initiation
	 	 	24	 
	 
	 	 	 	 
	SECTION 10.03. Arbitration Request
	 	 	24	 
	 
	 	 	 	 
	SECTION 10.04. Injunctive Relief
	 	 	25	 
	 
	 	 	 	 
	ARTICLE XI MISCELLANEOUS
	 	 	25	 
	 
	 	 	 	 
	SECTION 11.01. Notices
	 	 	25	 
	 
	 	 	 	 
	SECTION 11.02. Entire Agreement
	 	 	26	 
	 
	 	 	 	 
	SECTION 11.03. Waiver
	 	 	26	 
	 
	 	 	 	 
	SECTION 11.04. Amendment
	 	 	26	 
	 
	 	 	 	 
	SECTION 11.05. Independent Contractors
	 	 	26	 
	 
	 	 	 	 
	SECTION 11.06. No Third Party Beneficiary
	 	 	26	 
	 
	 	 	 	 
	SECTION 11.07. No Assignment; Binding Effect
	 	 	26	 






-ii-









 






TABLE OF CONTENTS




	 	 	 	 	 
	 	 	Page	 
	SECTION 11.08. Headings
	 	 	27	 
	 
	 	 	 	 
	SECTION 11.09. Submission to Jurisdiction; Waivers
	 	 	27	 
	 
	 	 	 	 
	SECTION 11.10. Severability
	 	 	28	 
	 
	 	 	 	 
	SECTION 11.11. Governing Law
	 	 	28	 
	 
	 	 	 	 
	SECTION 11.12. Counterparts
	 	 	28	 
	 
	 	 	 	 
	SECTION 11.13. Order of Precedence
	 	 	28	 
	 
	 	 	 	 
	SECTION 11.14. Ownership of and License to Data
	 	 	28	 







-iii-









 








Exhibits




	 	 	 
	EWS Subsidiaries

	 	Exhibit 1.01(a)
	SNI Subsidiaries

	 	Exhibit 1.01(b)
	EWS Services Required Consents

	 	Exhibit 5.01
	SNI Services Required Consents

	 	Exhibit 5.02
	Transition Teams and Team Leaders

	 	Exhibit 7.01






Schedules




	 	 	 
	Rate Card

	 	Schedule 3.01







-iv-









 








TRANSITION SERVICES AGREEMENT




     THIS TRANSITION SERVICES AGREEMENT (this “Agreement”) is entered into this 1st day of
July, 2008, by and between The E. W. Scripps Company, an Ohio corporation (“EWS”), and
Scripps Networks Interactive, Inc., an Ohio corporation and, prior to the Distribution Date, an
indirect subsidiary of EWS (“SNI” and, together with EWS, each, a “Party” and
collectively, the “Parties”). Capitalized terms used in this Agreement are defined as set
forth in Section 1.01.



RECITALS




     WHEREAS, the Board of Directors of EWS has determined that it is in the best interests of EWS
to separate the SNI Business and the EWS Business into two independent public companies, on the
terms and subject to the conditions set forth in the Separation Agreement (as defined below), in
order to separate businesses with differing strategic directions, eliminate existing constraints
regarding capital allocation, concentrate management focus, allow more tailored management
incentives, and accommodate differing shareholder bases;



     WHEREAS, in order to effectuate the foregoing, EWS and SNI have entered into a Separation and
Distribution Agreement, dated as of June 12, 2008 (the “Separation Agreement”), pursuant to
which and subject to the terms and conditions set forth therein, the SNI Business shall be
separated from the EWS Business, and all of the issued and outstanding Class A Common Shares, par
value $0.01 per share, of SNI and Common Voting Shares, par value $0.01 per share, of SNI
beneficially owned by EWS shall be distributed on a pro rata basis to the holders of the issued and
outstanding Class A Common Shares, par value $0.01 per share, of EWS and Common Voting Shares, par
value $0.01 per share, of EWS (the “Distribution”); and



     WHEREAS, in connection therewith and in order to ensure an orderly transition under the
Separation Agreement, EWS desires to provide, through the EWS Service Providers, to the SNI Group
certain transition services (the “EWS Services”) with respect to the operation of the SNI
Group following the Distribution Date, and SNI desires to provide, through the SNI Service
Providers, to the EWS Group certain transition services (the “SNI Services”) with respect
to the operation of the EWS Group following the Distribution Date, as such EWS Services and SNI
Services are more fully described in separate schedules (all such schedules, including any
appendices, exhibits or other attachments thereto, the “Schedules,” and each, a
“Schedule”) to this Agreement and pursuant to Section 2.10.



     NOW, THEREFORE, in consideration of the premises, and of the representations, warranties,
covenants and agreements set forth herein and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, and intending to be legally bound hereby,
the Parties hereby agree as follows:



ARTICLE I

DEFINITIONS




     SECTION 1.01. Definitions. As used in this Agreement, the following terms shall have
the meanings set forth below:



     “Action” means any claim, demand, complaint, charge, action, cause of action, suit,
countersuit, arbitration, litigation, inquiry, proceeding or investigation.



     “Additional EWS Scheduled Service” shall have the meaning assigned to it in Section 2.03.



 - 1 - 









 





     “Additional SNI Scheduled Service” shall have the meaning assigned to it in Section 2.04.



     “Affiliate” means, with respect to any specified Person, any other Person that directly, or
indirectly through one or more intermediaries, controls, is controlled by or is under common
control with, such specified Person; provided, however, that for purposes of this
Agreement, no member of either Group shall be deemed to be an Affiliate of any member of the other
Group. As used herein, “control” means the possession, directly or indirectly, of the power to
direct or cause the direction of the management and policies of such entity, whether through
ownership of voting securities or other interests, by contract or otherwise.



     “Agreement” shall have the meaning assigned to it in the preamble.



     “Ancillary Agreements” means the Employee Matters Agreement, the Trademark License Agreement,
the Transition Services Agreement, the Tax Allocation Agreement, the Software License Agreement and
the Retransmission Agreement.



     “Asset” means any right, property or asset, whether real, personal or mixed, tangible or
intangible, of any kind, nature and description, whether accrued, contingent or otherwise, and
wheresoever situated and whether or not carried or reflected, or required to be carried or
reflected, on the books of any Person.



     “Best Efforts” means with respect to either Party, the efforts that such Party would use on
behalf of itself to enforce its rights against a third party or cause such third party to honor its
obligations to such Party under any agreement with such third party.



     “Consents” means any consents, waivers, notices, reports or other filings to be made, or any
registrations, licenses, permits, authorizations to be obtained from, or approvals from, or
notification requirements to, any third parties, including any Governmental Authority.



     “Defaulting Party” shall have the meaning assigned to it in Section 4.03(a)(i).



     “Distribution” shall have the meaning assigned to it in the preamble.



     “Distribution Date” means the date on which the Distribution shall be effected, such date to
be determined by, or under the authority of, the Board of Directors of EWS in its sole and absolute
discretion.



     “EWS” shall have the meaning assigned to it in the preamble.



     “EWS Business” means all businesses and operations conducted by the EWS Group from time to
time, whether prior to, at or after the Distribution Date, other than the SNI Business.



     “EWS Data” means all data relating primarily to the EWS Business (including all files, records
and other Information relating primarily to the EWS Business that have been uploaded to Software at
any time since EWS or SNI began using such Software, whether uploaded prior to, on, or after the
Distribution Date).



     “EWS Group” means, as of the Distribution Date, EWS and each of its Subsidiaries, including
those Subsidiaries set forth on Exhibit 1.01(a), and any corporation or entity that may
become part of such Group from time to time thereafter. The EWS Group shall not include any member
of the SNI Group.



 - 2 - 









 





     “EWS Service Providers” means the EWS Group members and any Third Party Service Provider, in
each case, to the extent such Person is providing the EWS Services on behalf of EWS pursuant to any
Schedule.



     “EWS Services” shall have the meaning assigned to it in the recitals.



     “EWS Transition Plan” shall have the meaning assigned to it in Section 2.10(c).



     “Force Majeure Event” means any act of God, fire, flood, storm or explosion; any strike,
lockout or other labor disturbance; any material shortage of facilities, labor, materials or
equipment; any delay in transportation, breakdown or accident; any Law; any riot, war, act of
terror, rebellion or insurrection; any embargo or fuel or energy shortage; any interruption in
telecommunications or utilities services; or any other event, in each case beyond the control of a
Party and that actually prevents, hinders or delays such Party from performing its obligations
under this Agreement.



     “Governmental Authority” means any federal, state, local, foreign or international court,
government, department, commission, board, bureau or agency, or any other regulatory,
self-regulatory, administrative or governmental organization or authority.



     “Group” means the EWS Group or the SNI Group as the context requires.



     “Information” means all information, whether or not patentable or copyrightable, in written,
oral, electronic or other tangible or intangible forms, stored in any medium, including non-public
financial information, studies, reports, records, books, accountants’ work papers, contracts,
instruments, surveys, discoveries, ideas, concepts, know-how, techniques, designs, specifications,
drawings, blueprints, diagrams, models, prototypes, samples, flow charts, data, computer data,
disks, diskettes, tapes, computer programs or other Software, marketing plans, customer data,
communications by or to attorneys, memos and other materials prepared by attorneys and accountants
or under their direction (including attorney work product) and other technical, financial, legal,
employee or business information or data.



     “Intellectual Property” means all intellectual property and other similar proprietary rights
in any jurisdiction, whether owned or held for use under license, whether registered or
unregistered, including such rights in and to: (i) trademarks, trade dress, service marks,
certification marks, logos, trade names and the goodwill associated with the foregoing; (ii)
patents and patent applications and any and all divisions, continuations, continuations-in-part,
reissues, continuing patent applications, reexaminations and extensions thereof, any counterparts
claiming priority therefrom, utility models, patents of importation/confirmation, certificates of
invention, certificates of registration, design registrations or patents and like rights; (iii)
inventions, invention disclosures, discoveries and improvements, whether or not patentable; (iv)
writings and other works of authorship; (v) trade secrets (including, those trade secrets defined
in the Uniform Trade Secrets Act and under corresponding foreign statutory Law and common law),
Information, business, technical and know-how information, business processes, non-public
information, proprietary information and confidential information and rights to limit the use or
disclosure thereof by any Person; (vi) software, including data files, source code, object code,
application programming interfaces, databases and other software-related specifications and
documentation (collectively, “Software”); (vii) domain names and uniform resource locators; (viii)
moral rights; (ix) privacy and publicity rights; (x) advertising and promotional materials, whether
or not copyrightable; and (xi) claims, causes of action and defenses relating to the enforcement of
any of the foregoing; in each case, including any registrations of, applications to register, and
renewals and extensions of, any of the foregoing with or by any Governmental Authority in any
jurisdiction.



 - 3 - 









 





     “Law” means any applicable foreign, federal, national, state, provincial or local law
(including common law), statute, ordinance, rule, regulation, code or other requirement enacted,
promulgated, issued or entered into, or act taken, by a Governmental Authority.



     “Liabilities” means all debts, liabilities, obligations, responsibilities, response actions,
Losses, damages (whether compensatory, punitive, consequential, treble or other), fines, penalties
and sanctions, absolute or contingent, matured or unmatured, liquidated or unliquidated, foreseen
or unforeseen, on- or off-balance sheet, joint, several or individual, asserted or unasserted,
accrued or unaccrued, known or unknown, whenever arising, including those arising under or in
connection with any Law, or other pronouncements of Governmental Authorities constituting an
Action, order or consent decree of any Governmental Authority or any award of any arbitration
tribunal, and those arising under any contract, guarantee, commitment or undertaking, whether
sought to be imposed by a Governmental Authority, private party, or a Party, whether based in
contract, tort, implied or express warranty, strict liability, criminal or civil statute, or
otherwise, and including any costs, expenses, interest, attorneys’ fees, disbursements and expense
of counsel, expert and consulting fees, fees of third party administrators and costs related
thereto or to the investigation or defense thereof.



     “Loss” shall have the meaning assigned to it in Section 9.06.



     “Non Defaulting Party” shall have the meaning assigned to it in Section 4.03(a).



     “Party” or “Parties” shall have the meaning assigned to such terms in the preamble.



     “Person” means any natural person, corporation, general or limited partnership, limited
liability company or partnership, joint stock company, joint venture, association, trust, bank,
trust company, land trust, business trust or other organization, whether or not a legal entity, and
any Governmental Authority.



     “Prime Rate” means the “prime rate” published in the “Money Rates” section of The Wall Street
Journal. If The Wall Street Journal ceases to publish the “prime rate,” then the Parties shall
mutually agree to an equivalent publication that publishes such “prime rate,” and if such “prime
rate” is no longer generally published or is limited, regulated or administered by a Governmental
Authority, then a comparable interest rate index mutually agreed to by the Parties.



     “Registration Statement” means the Registration Statement on Form 10 of SNI as declared
effective by the United States Securities and Exchange Commission relating to the registration
under the United States Exchange Act of 1934, as amended, of the Class A Common Shares, par value
$0.01 per share, of SNI, including any post-effective amendments thereto and all exhibits
(including the SNI Information Statement) and other documents incorporated therein by reference.



     “Schedule” or “Schedules” shall have the meaning assigned to such terms in the recitals.



     “Separation Agreement” shall have the meaning assigned to it in the recitals.



     “Service Provider” means the EWS Service Providers and/or the SNI Service Providers, as the
context requires.



     “Service Recipient” means either any member of the EWS Group , to the extent such member of
the EWS Group is receiving a Service from an SNI Service Provider, or any member of the SNI Group ,
to the extent such member of the SNI Group is receiving a Service from an EWS Service Provider, as
the context requires.



 - 4 - 









 





     “Service Taxes” shall have the meaning assigned to it in Section 3.06.



     “Services” means the EWS Services and/or the SNI Services, as the context requires.



     “SNI” shall have the meaning assigned to it in the preamble.



     “SNI Business” means all businesses and operations conducted by the SNI Group from time to
time, whether prior to, at or after the Distribution Date, including the businesses and operations
conducted by the SNI Group as more fully described in the SNI Information Statement and excluding
the EWS Business.



     “SNI Data” means all data relating primarily to the SNI Business (including all files, records
and other Information relating primarily to the SNI Business that have been uploaded to Software at
any time since EWS or SNI began using such Software, whether uploaded prior to, on, or after the
Distribution Date).



     “SNI Group” means, as of the Distribution Date, SNI and each of its Subsidiaries, including
those Subsidiaries set forth on Exhibit 1.01(b), and any corporation or entity that may
become part of such Group from time to time thereafter. The SNI Group shall not include any member
of the EWS Group.



     “SNI Information Statement” means the definitive information statement distributed to the
holders of EWS Common Voting Shares in connection with the Distribution and filed with the United
States Securities and Exchange Commission as Exhibit 99.1 to the Registration Statement or as an
exhibit to a Form 8-K of SNI.



     “SNI Service Providers” means the SNI Group members and any Third Party Service Provider, in
each case, to the extent such Person is providing the SNI Services on behalf of SNI pursuant to any
Schedule.



     “SNI Services” shall have the meaning assigned to it in the recitals.



     “SNI Transition Plan” shall have the meaning assigned to it in Section 2.10(b).



     “Software” shall have the meaning assigned to it in Section 1.01.



     “Subsidiary” means, with respect to any specified Person, any other Person of which the
specified Person (either alone or through or together with any other Subsidiary of such Person)
owns, directly or indirectly, a majority of the stock or other equity interests the holders of
which are generally entitled to vote for the election of the board of directors or other governing
body of such corporation or other legal entity and, solely for purposes of determining whether an
entity is within the EWS Group or the SNI Group, any other Person that directly, or indirectly
through one or more intermediaries, is controlled by such specified Person, with “control” meaning
the possession, directly or indirectly, of the power to direct or cause the direction of the
management and policies of such entity, whether through ownership of voting securities or other
interests, by contract or otherwise.



     “SOX” means the Sarbanes-Oxley Act of 2002, as amended from time to time.



     “Taxes” means any federal, state, local or foreign income, gross receipts, property, sales,
use, license, excise, franchise, employment, payroll, premium, withholding, alternative or added
minimum, ad valorem, transfer or excise tax or any other tax, custom, duty, governmental fee or
other like assessment



 - 5 - 









 




or charge or any kind whatsoever, together with any interest or penalty or addition thereto,
whether disputed or not, imposed by any Governmental Authority.




     “Tax Return” means any return, report or similar statement required to be filed with respect
to any Tax (including any attached Schedules), including any information return, claim for refund,
amended return or declaration of estimated Tax.



     “Team Leader” shall have the meaning assigned to it in Section 7.01.



     “Third Party Service Provider” means any third party that is providing Services on behalf of
EWS or SNI pursuant to any Schedule.



     “Third Party Vendor Costs” shall have the meaning assigned to it in Section 3.03.



     “Transition Plans” means the EWS Transition Plan and/or the SNI Transition Plan, as the
context requires.



     “Transition Team” shall have the meaning assigned to it in Section 7.01.



     SECTION 1.02. General Interpretive Principles. Words in the singular shall include
the plural and vice versa, and words of one gender shall include the other gender, in each case, as
the context requires. The words “hereof,” “herein,” “hereunder,” and “herewith” and words of
similar import shall, unless otherwise stated, be construed to refer to this Agreement and not to
any particular provision of this Agreement, and references to Article, Section, paragraph, exhibit
and schedule are references to the Articles, Sections, paragraphs, exhibits and schedules to this
Agreement unless otherwise specified. The word “including” and words of similar import when used
in this Agreement shall mean “including, without limitation,” unless otherwise specified. Any
reference to any federal, state, local or non-U.S. statute or Law shall be deemed to also refer to
all rules and regulations promulgated thereunder, unless the context otherwise requires.



ARTICLE II

TRANSITION SERVICES




     SECTION 2.01. EWS Scheduled Services. During the term of this Agreement, EWS shall
provide, or shall cause one or more EWS Service Providers to provide, to the applicable member or
members of the SNI Group (such member or members of the SNI Group as determined by SNI in its sole
discretion), the EWS Services, as such EWS Services are more particularly described in the
applicable Schedules attached hereto, upon the terms and subject to the conditions of this
Agreement and such applicable Schedules, including such EWS Services as shall be specified in the
Schedules as contemplated by Section 2.10.



     SECTION 2.02. SNI Scheduled Services. During the term of this Agreement, SNI shall
provide, or shall cause one or more SNI Service Providers to provide, to the applicable member or
members of the EWS Group (such member or members of the EWS Group as determined by EWS in its sole
discretion), the SNI Services, as such SNI Services are more particularly described in the
applicable Schedules attached hereto, upon the terms and subject to the conditions of this
Agreement and such applicable Schedules, including such SNI Services as shall be specified in the
Schedules as contemplated by Section 2.10.



     SECTION 2.03. Additional EWS Scheduled Services. If, from time to time during the
term of this Agreement, SNI determines that the provision of a service by the EWS Group that is not
described on



 - 6 - 









 




the Schedules is reasonably necessary to enable the SNI Group to operate the SNI Business,
including any Services contemplated by Section 2.10, and such service (whether or not then
currently being provided) is not included in a Schedule (such service, including the right to use,
or the use of, any Asset in connection with such service, hereinafter referred to as an
“Additional EWS Scheduled Service”), then SNI may give written notice thereof to EWS in
accordance with Section 11.01 hereof. Upon receipt of such notice by EWS, if EWS is reasonably
able to provide, or cause to be provided, such Additional EWS Scheduled Service, the Parties will
negotiate in good faith, on an arms’-length basis, to attempt to agree on a Schedule setting forth
the Additional EWS Scheduled Service, the terms and conditions (including any service level
requirements) for the provision of such Additional EWS Scheduled Service and the fees and expenses
payable by SNI for such Additional EWS Scheduled Service.




     SECTION 2.04. Additional SNI Scheduled Services. If, from time to time during the
term of this Agreement, EWS determines that the provision of a service by the SNI Group that is not
described on the Schedules is reasonably necessary to enable the EWS Group to operate the EWS
Business, including any Services contemplated by Section 2.10, and such service (whether or not
then currently being provided) is not included in a Schedule (such service, including the right to
use, or the use of, any Asset in connection with such service, herein after referred to as an
“Additional SNI Scheduled Service”), then EWS may give written notice thereof to SNI in
accordance with Section 11.01 hereof. Upon receipt of such notice by SNI, if SNI is reasonably
able to provide, or cause to be provided, the Additional SNI Scheduled Service, the Parties will
negotiate in good faith, on an arms’-length basis, to attempt to agree on a Schedule setting forth
the Additional SNI Scheduled Service, the terms and conditions (including any service level
requirements) for the provision of such Additional SNI Scheduled Service and the fees and expenses
payable by EWS for such Additional SNI Scheduled Service.



     SECTION 2.05. Scope of EWS Services; Standard of Performance for EWS Services.



          (a) EWS shall provide, or shall cause to be provided, the EWS Services in a manner and at a
level that is substantially similar in all material respects to the typical manner and average
level at which such EWS Services were provided to the applicable member or members of the SNI Group
during the six-month period prior to the Distribution Date, except to the extent that (i) a
different manner or level of an EWS Service is set forth in a Schedule, in which case such EWS
Service shall be provided in the manner and level as set forth in each such applicable Schedule or
(ii) such EWS Service has not been provided during the six-month period prior to the Distribution
Date and the applicable Schedule does not set forth a manner or level at which such EWS Service is
to be provided, in which case, such EWS Service shall be provided in the same manner and at the
same level at which such EWS Service was provided to the applicable member or members of the SNI
Group on the last occasion (or during the six-month period prior to the last occasion) such EWS
Service was provided to any member of the SNI Group.




          (b) Notwithstanding Section 2.05(a), EWS may change from time to time the manner in which any
EWS Service is provided to the SNI Group, to the extent that EWS is making a similar change in
performing a substantially similar service for itself or its Subsidiaries and if EWS provides SNI
substantially the same notice (in content and timing) as EWS provides itself and its Subsidiaries
with respect to such change; provided, that, EWS may not make any change to the manner in which any
EWS Service is provided to the SNI Group if such change would result in a violation, or cause any
member of the SNI Group to be in violation, of applicable Law; provided, further, if SNI can
demonstrate, in accordance with the terms of this Agreement, that such change is not commercially
reasonable and the SNI Group has suffered a material financial harm as a result of such change, EWS
shall be required to restore, or cause to be restored, the manner in which such EWS Service is
provided to the SNI Group to the manner required by Section 2.05(a). No such change shall affect
the fees and expenses for, or materially diminish the quality of, the applicable EWS Service.




 - 7 - 









 








          (c) Notwithstanding anything contained herein, EWS may decline to provide all or any part of
any particular Service, if EWS reasonably believes that the performance of any EWS Service
Provider’s obligations relating thereto would violate any applicable Law applicable to such EWS
Service Provider’s business, but only (i) to the extent reasonably necessary for such EWS Service
Provider to ensure compliance therewith, (ii) after such EWS Service Provider has applied
commercially reasonable efforts to reduce the amount and/or effect of any such restrictions and
(iii) after EWS has delivered written notice to SNI specifying in reasonable detail the nature of
the applicable restrictions and of any proposed resulting modification in such EWS Service
Provider’s obligations.




          (d) Subject to Section 9.03, in no event shall EWS be liable or accountable, in damages or
otherwise, for any error of judgment or any mistake of fact or Law or for any action or omission in
connection with the provision of the EWS Services by any EWS Service Provider that such EWS Service
Provider took or refrained from taking in good faith hereunder, except in the case of such EWS
Service Provider’s intentional breach, fraud, gross negligence or willful misconduct.




     SECTION 2.06. Scope of SNI Services; Standard of Performance for SNI Services.



          (a) SNI shall provide, or shall cause to be provided, the SNI Services in a manner and at a
level that is substantially similar in all material respects to the typical manner and average
level at which such SNI Services were provided to the applicable member or members of the EWS Group
during the six-month period prior to the Distribution Date, except to the extent that (i) a
different manner or level of an SNI Service is set forth in a Schedule, in which case such SNI
Service shall be provided in the manner and level as set forth in each such applicable Schedule or
(ii) such SNI Service has not been provided during the six-month period prior to the Distribution
Date and the applicable Schedule does not set forth a manner or level at which such SNI Service is
to be provided, in which case, such SNI Service shall be provided in the same manner and at the
same level at which such SNI Service was provided to the applicable member or members of the EWS
Group on the last occasion (or during the six-month period prior to the last occasion) such SNI
Service was provided to any member of the EWS Group.




          (b) Notwithstanding Section 2.06(a), SNI may change from time to time the manner in which any
SNI Service is provided to the EWS Group, to the extent that SNI is making a similar change in
performing a substantially similar service for itself or its Subsidiaries and if SNI provides EWS
substantially the same notice (in content and timing) as SNI provides itself and its Subsidiaries
with respect to such change; provided, that, SNI may not make any change to the manner in which any
SNI Service is provided to the EWS Group if such change would result in a violation, or cause any
member of the EWS Group to be in violation, of applicable Law; provided, further, if EWS can
demonstrate, in accordance with the terms of this Agreement, that such change is not commercially
reasonable and the EWS Group has suffered a material financial harm as a result of such change, SNI
shall be required to restore, or cause to be restored, the manner in which such SNI Service is
provided to the EWS Group to the manner required by Section 2.06(a). No such change shall affect
the fees and expenses for, or materially diminish the quality of, the applicable SNI Service.




          (c) Notwithstanding anything contained herein, SNI may decline to provide all or any part of
any particular Service, if SNI reasonably believes that the performance of any SNI Service
Provider’s obligations relating thereto would violate any applicable Law applicable to such SNI
Service Provider’s business, but only (i) to the extent reasonably necessary for such SNI Service
Provider to ensure compliance therewith, (ii) after such SNI Service Provider has applied
commercially reasonable efforts to reduce the amount and/or effect of any such restrictions and
(iii) after SNI has delivered written notice to EWS specifying in reasonable detail the nature of
the applicable restrictions and of any proposed resulting modification in such SNI Service
Provider’s obligations.




 - 8 - 









 








          (d) Subject to Section 9.04, in no event shall SNI be liable or accountable, in damages or
otherwise, for any error of judgment or any mistake of fact or Law or for any action or omission in
connection with the provision of the SNI Services by any SNI Service Provider that such SNI Service
Provider took or refrained from taking in good faith hereunder, except in the case of such SNI
Service Provider’s intentional breach, fraud, gross negligence or willful misconduct.




     SECTION 2.07. Personnel Providing Services; Subcontracting.



          (a) Each Service Provider shall have the sole and exclusive responsibility for selecting and
managing their personnel who provide the applicable Services and shall supervise them in connection
with the performance of the applicable Services. Such personnel shall be qualified, in the
reasonable opinion of such Service Provider, for the tasks to which they are assigned. Such
Service Provider shall pay and be responsible for all wages, salary or other compensation, taxes,
insurance and, except as expressly specified herein or in any Schedule or separate agreement, other
costs and expenses with respect to such personnel.




          (b) To the extent that any Service Provider determines that it is desirable for any reason in
its sole discretion, such Service Provider may, without revising the fees otherwise charged to the
Service Recipient, contract with reasonably qualified third parties to provide any or all Services
to the applicable Service Recipient for all or part of the remainder of the term of this Agreement.
No such Third Party Service Provider shall be provided access to any Information of Service
Recipient or the applicable member of its Group unless such Third Party Service Provider is bound
by non-disclosure obligations at least as restrictive as those contained herein.




          (c) Each Service Provider shall remain fully responsible for its performance of the applicable
Services in accordance with the terms hereof, including any obligations it performs through Third
Party Service Providers, and each Service Provider shall be solely responsible for all payments due
to Third Party Service Providers. Notwithstanding anything contained herein to the contrary,
amounts due from any Service Provider to its subcontractors shall not be included in, or be deemed
to be, Third Party Vendor Costs to the extent such amounts are for services that are duplicative of
any Services for which any Service Provider is charging a fee hereunder.




          (d) In the event any Liability arises from the performance of the Services hereunder by a
Third Party Service Provider, the Service Provider shall not be released from its responsibilities
under this Agreement and all applicable Service Recipients shall be subrogated to such rights, if
any, as the applicable Service Provider may have against such Third Party Service Provider with
respect to the Services provided by such Third Party Service Provider to or on behalf of the
Service Recipient.




     SECTION 2.08. Interruption of Services.



          (a) If, due to a Force Majeure Event, an EWS Service Provider is unable, wholly or partially,
to perform its obligations hereunder, then EWS shall be relieved of liability and shall suffer no
prejudice for failing to perform or comply during the continuance and to the extent of such whole
or partial inability to perform its obligations hereunder so caused by such Force Majeure Event;
provided, that, (i) EWS gives SNI prompt notice, written or oral (but if oral, promptly confirmed
in writing) of such whole or partial inability to perform the obligations hereunder and a
reasonably detailed description of the cause thereof and (ii) in the event such whole or partial
inability to perform its obligations hereunder is a result of such EWS Service Provider’s capacity
or similar limitations, with respect to the allocation of such limited resources, the SNI Group
shall be treated no less favorably by such EWS Service Provider than EWS or any Subsidiary of EWS.
If EWS fails to promptly give notice of such Force Majeure Event, then EWS shall only be relieved
from such performance or compliance from and after the giving of such




 - 9 - 









 







notice. EWS shall or shall cause the applicable EWS Service Provider(s) to use its
commercially reasonable efforts to remedy the situation caused by such Force Majeure Event and
remove, so far as possible and with reasonable timeliness, the cause of its inability to perform or
comply. EWS shall give SNI prompt notice of the cessation of the Force Majeure Event.




          (b) If, due to a Force Majeure Event, an SNI Service Provider is unable, wholly or partially,
to perform its obligations hereunder, then SNI shall be relieved of liability and shall suffer no
prejudice for failing to perform or comply during the continuance and to the extent of such whole
or partial inability to perform its obligations hereunder so caused by such Force Majeure Event;
provided, that, (i) SNI gives EWS prompt notice, written or oral (but if oral, promptly confirmed
in writing) of such whole or partial inability to perform the obligations hereunder and a
reasonably detailed description of the cause thereof and (ii) in the event such whole or partial
inability to perform its obligations hereunder is a result of such SNI Service Provider’s capacity
or similar limitations, with respect to the allocation of such limited resources, the EWS Group
shall be treated no less favorably by such SNI Service Provider than SNI or any Subsidiary of SNI.
If SNI fails to promptly give notice of such Force Majeure Event, then SNI shall only be relieved
from such performance or compliance from and after the giving of such notice. SNI shall or shall
cause the applicable SNI Service Provider(s) to use its commercially reasonable efforts to remedy
the situation caused by such Force Majeure Event and remove, so far as possible and with reasonable
timeliness, the cause of its inability to perform or comply. SNI shall give EWS prompt notice of
the cessation of the Force Majeure Event.




     SECTION 2.09. Disaster Recovery and Business Continuity.



          (a) The EWS Service Providers will document the process for recovering and maintaining
operations and services in the event of a disruption of normal operations, a disaster, a Force
Majeure Event or other unforeseen circumstance, which documentation will include procedures for an
orderly restoration of the computing environment, applications and network services. The intent of
such documentation is to document steps to remedy the impact or disruption of services within an
acceptable recovery time period. The EWS Service Providers will periodically review and maintain
such documentation throughout the term of this Agreement. The EWS Service Providers will notify
SNI of any material change or modification in such documentation.




          (b) The EWS Service Providers will back-up all system software, applications and data as
frequently and in such manner as shall be substantially comparable to the frequency and manner that
was practiced by the Parties during the six-month period prior to the Distribution Date. Each EWS
Service Provider will perform all such back-ups in accordance with such EWS Service Provider’s
internal policies and procedures. Without limiting the foregoing, the EWS Service Providers will
(i) properly store offsite all back-up tapes, disks and other media, (ii) maintain a log of all
back-ups to ensure proper rotation of back-up tapes, disks and other media and (iii) perform
back-ups at least weekly and send back-up tapes, disks and other media offsite within 48 hours.




          (c) The SNI Service Providers will document the process for recovering and maintaining
operations and services in the event of a disruption of normal operations, a disaster, a Force
Majeure Event or other unforeseen circumstance, which documentation will include procedures for an
orderly restoration of the computing environment, applications and network services. The intent of
such documentation is to document steps to remedy the impact or disruption of services within an
acceptable recovery time period. The SNI Service Providers will periodically review and maintain
such documentation throughout the term of this Agreement. The SNI Service Providers will notify
EWS of any material change or modification in such documentation.




 - 10 - 









 








          (d) The SNI Service Providers will back-up all system software, applications and data as
frequently and in such manner as shall be substantially comparable to the frequency and manner that
was practiced by the Parties during the six-month period prior to the Distribution Date. Each SNI
Service Provider will perform all such back-ups in accordance with such SNI Service Provider’s
internal policies and procedures. Without limiting the foregoing, the SNI Service Providers will
(i) properly store offsite all back-up tapes, disks and other media, (ii) maintain a log of all
back-ups to ensure proper rotation of back-up tapes, disks and other media and (iii) perform
back-ups at least weekly and send back-up tapes, disks and other media offsite within 48 hours.




     SECTION 2.10. Transition of Responsibilities.



          (a) Each Party agrees to use its good faith efforts to reduce or eliminate its and the other
members of its Group’s dependency on each Service provided by the other Party and members of its
Group as soon as is reasonably practicable and, in any event, at the times or upon the occurrence
of any events described in the SNI Transition Plan or EWS Transition Plan, as the case may be.
Each Party further agrees, for itself and each Service Provider within its Group, to cooperate with
the other Party and the Service Recipients within its Group, to facilitate the orderly transition
of responsibility for each Service to the Service Recipient or any third party designated by the
Service Recipient, including by providing the transition and termination services described in the
SNI Transition Plan or EWS Transition Plan, as the case may be.




          (b) As promptly as practicable, EWS and SNI will agree in good faith to a plan for SNI to
assume responsibility or eliminate the need for the provision of each EWS Service including such
matters as shall be set forth in the Schedules (the “SNI Transition Plan”). The SNI
Transition Plan will contain a schedule of transition events, including the expected date by which
the SNI Transition Plan for each EWS Service will be completed, any training (including the
transfer of knowledge and expertise) or other services that will be needed by the SNI Group members
(or their third party designees) and the estimated costs and expenses, if any, to be paid by SNI to
EWS with respect to such training and other services that EWS agrees to provide to the SNI Group
members in order to facilitate the completion of the SNI Transition Plan. The SNI Transition Plan
shall incorporate, without duplication of fees or expenses payable by the Service Recipient, all
agreements with respect to such matters as shall be set forth in the Schedules.




          (c) As promptly as practicable, EWS and SNI will agree in good faith to a plan for EWS to
assume responsibility or eliminate the need for the provision of each SNI Service including such
matters as shall be set forth in the Schedules (the “EWS Transition Plan”). The EWS
Transition Plan will contain a schedule of transition events, including the expected date by which
the EWS Transition Plan for each SNI Service will be completed, any training (including the
transfer of knowledge and expertise) or other services that will be needed by the EWS Group members
(or their third party designees) and the estimated costs and expenses, if any, to be paid by EWS to
SNI with respect to such training and other services that SNI agrees to provide to the EWS Group
members in order to facilitate the completion of the EWS Transition Plan. The EWS Transition Plan
shall incorporate, without duplication of fees or expenses payable by the Service Recipient, all
agreements with respect to such matters as shall be set forth in the Schedules.




          (d) If either Party from time to time determines that a modification to the SNI Transition
Plan or EWS Transition Plan is reasonably necessary, then such Party may give written notice
thereof to the other Party in accordance with Section 11.01 hereof and the Parties will negotiate
in good faith, on an arms’-length basis, to attempt to agree on terms and conditions in respect of
such requested modification, including any fees or expenses payable in connection therewith. Any
modification within the subject matter of a request for Additional EWS Scheduled Services pursuant
to Section 2.03 shall be




 - 11 - 









 







governed exclusively by Section 2.03. Any modification within the subject matter of a request
for Additional SNI Scheduled Services pursuant to Section 2.04 shall be governed exclusively by
Section 2.04.




     SECTION 2.11. Insurance.



          (a) During the term of this Agreement, each Party shall obtain and maintain the following
insurance: (i) Commercial General Liability with combined single limit of not less than $1,000,000
each occurrence for bodily injury and property damage; (ii) Worker’s Compensation in amounts
required by applicable law and Employer’s Liability with a limit of at least $1,000,000 each
accident; and (iii) Automobile Liability including coverage for owned/leased, non-owned or hired
automobiles with combined single limit of not less than $1,000,000 each accident.




          (b) All insurance policies obtained from U.S. insurers shall be maintained with companies
rated A or better by Best’s Key Rating Guide, and each party shall, upon request, provide the other
party with an insurance certificate confirming compliance with the requirements of this
Section 2.11(b).




          (c) Each Party shall exercise its commercially reasonable efforts to obtain from the insurance
companies providing the coverage required by this Agreement waivers of their rights to subrogation
against the other Party, its Subsidiaries, assignees, officers, directors and employees.




ARTICLE III

FEES AND EXPENSES




     SECTION 3.01. Fees and Expenses. The fees and expenses for each of the Services to be
provided hereunder shall be as set forth in the Schedules and Transition Plans; provided that the
applicable fees shall be as set forth on the Rate Card attached hereto as Schedule 3.01 in
the event not otherwise specified in a Schedule. The amount of each fee for Services set forth in
the Schedules shall increase automatically by an amount equal to 3.5% of such fee on January 1,
2009 and each January 1st thereafter until this Agreement or the applicable Service is terminated
in accordance with the terms hereof.



     SECTION 3.02. Billing and Payment; No Set-off. Amounts payable in respect of
Services under this Agreement shall be invoiced to the Party receiving such Services monthly in
arrears and paid to the Party providing such Services, as directed by such providing Party, which
amounts shall be due within 30 days after the date of invoice. All amounts due and payable
hereunder shall be invoiced and, except as set forth in any Schedule or Transition Plan, paid in
U.S. dollars without offset, set-off, deduction or counterclaim, however arising.



     SECTION 3.03. Third Party Vendor Costs. In order to provide the Services, the Parties
acknowledge and agree that it may be necessary for a Service Provider to pay third party suppliers
or vendors incremental or other costs and expenses or new costs or expenses, other than and in
addition to the costs and expenses payable to third party suppliers or vendors expressly described
in Schedules or Transition Plans, incidental to providing the Services, including programming fees,
maintenance fees, initiation and set up costs and license fees and costs associated with any third
party intellectual property (all such costs and expenses, the “Third Party Vendor Costs”).
Unless specified otherwise in the applicable Schedule(s), all such amounts shall be included in the
amounts payable by the Party receiving the applicable Services pursuant to Section 3.02.



 - 12 - 









 





     SECTION 3.04. Additional Costs.



          (a) SNI shall reimburse EWS for the costs designated in each Schedule or Transition Plan as
reimbursable by SNI. If it is necessary for any EWS Service Provider to incur any additional costs
in connection with the provision of the EWS Services, other than any Third Party Vendor Costs
(which Third Party Vendor Costs are governed by Section 3.03), EWS shall inform SNI of such need
before any such additional cost is incurred. Upon mutual written agreement of SNI and EWS, as to
the necessity of any such increase, subject to the remainder of this Section 3.04(a), SNI shall pay
to EWS, upon completion of the related EWS Services, an amount equal to the estimated costs and
expenses to be reasonably incurred in connection therewith. If the actual costs and expenses
incurred by such EWS Service Provider are greater than the estimated costs, the necessity of
increased costs shall again be subject to the mutual written agreement of the Parties, and if the
Parties cannot agree, (i) SNI shall pay to EWS an amount equal to the estimated costs and expenses
and (ii) EWS shall not receive payment or reimbursement for any such increased costs in connection
with the provision of such EWS Service to the extent not previously agreed upon by the Parties. If
the actual costs and expenses incurred by such EWS Service Provider are less than the estimated
costs and expenses, SNI shall pay to EWS an amount equal to the actual costs and expenses.




          (b) EWS shall reimburse SNI for the costs designated in each Schedule or Transition Plan as
reimbursable by EWS. If it is necessary for any SNI Service Provider to incur any additional costs
in connection with the provision of the SNI Services, other than any Third Party Vendor Costs
(which Third Party Vendor Costs are governed by Section 3.03), SNI shall inform EWS of such need
before any such additional cost is incurred. Upon mutual written agreement of EWS and SNI, as to
the necessity of any such increase, subject to the remainder of this Section 3.04(a), EWS shall pay
to SNI, upon completion of the related SNI Services, an amount equal to the estimated costs and
expenses to be reasonably incurred in connection therewith. If the actual costs and expenses
incurred by such SNI Service Provider are greater than the estimated costs, the necessity of
increased costs shall again be subject to the mutual written agreement of the Parties, and if the
Parties cannot agree, (i) EWS shall pay to SNI an amount equal to the estimated costs and expenses
and (ii) SNI shall not receive payment or reimbursement for any such increased costs in connection
with the provision of such SNI Service to the extent not previously agreed upon by the Parties. If
the actual costs and expenses incurred by such SNI Service Provider are less than the estimated
costs and expenses, EWS shall pay to SNI an amount equal to the actual costs and expenses.




     SECTION 3.05. Late Payments. Late payments shall bear interest at a rate per annum
equal to the Prime Rate plus 2%.



     SECTION 3.06. Tax Matters.



          (a) Each Party in its capacity as Service Recipient shall pay or cause to be paid all sales,
service, valued added, use, excise, occupation and other similar taxes and duties (together in each
case with all interest, penalties, fines and additions thereto) that are assessed against either
Party on the provision of Services as a whole, or any particular Service (including with respect to
amounts paid by the Service Provider to third parties), including Additional EWS Scheduled Services
or Additional SNI Scheduled Services, as applicable, received by any applicable Service Recipient
or any members of its Group from any Service Provider or any members of its Group pursuant to the
terms of this Agreement (collectively, “Service Taxes”). If required under applicable Law
(or in the case of Service Taxes relating to amounts paid by the Service Provider to third
parties), each Service Provider shall invoice the Service Recipient for the full amount of all
Service Taxes, and such Service Recipient shall pay, in addition to the other amounts required to
be paid pursuant to the terms of this Agreement, such Service Taxes to such Service Provider.




 - 13 - 









 








          (b) Notwithstanding anything to the contrary contained herein, each Service Provider shall not
be liable for any claim in respect of Services relating to Taxes or Tax Returns of the Service
Recipient or any other member of its Group, except to the extent that such claim arises from the
willful misconduct or gross negligence of such Service Provider.




ARTICLE IV

TERM; TERMINATION




     SECTION 4.01. Term. This Agreement shall commence on the Distribution Date and unless
terminated earlier in accordance with this Article IV, will terminate on the earlier to occur of
(a) the second anniversary of the Distribution Date and (b) the date on which the terms of all the
Schedules have expired or been terminated.



     SECTION 4.02. Force Majeure Event Early Termination of Services. In the event that
pursuant to Section 2.08, a Service Provider reduces or suspends the provision of any Service due
to a Force Majeure Event and such reduction or suspension continues for 15 days, the other Party
may immediately terminate the applicable Service, upon written notice and without any reimbursement
obligation.



     SECTION 4.03. Early Termination of this Agreement.



          (a) This Agreement may be terminated by (x) the mutual written consent of each Party, (y) as
may be set forth in the applicable Schedule or (z) by a Party (a “Non Defaulting Party”)
upon written notice to the other Party if:





          (i) the other Party fails in any material respect to perform its obligations under or
breaches in any material respect this Agreement (the “Defaulting Party”) and such
failure to perform or breach of an obligation is not cured within 30 days of the date on
which written notice is received by the Defaulting Party setting forth in reasonable detail
the manner in which the Defaulting Party failed to perform its obligations hereunder and
stating that the Non-Defaulting Party intends to terminate this Agreement with respect to
the Defaulting Party if such failure or breach is not cured within 30 days of such notice;
or




          (ii) the other Party makes a general assignment for the benefit of creditors, becomes
insolvent, or has a receiver appointed or reorganization or arrangement proceedings approved
by a court.



          (b) Any Service or Services provided hereunder may be terminated by a Service Recipient upon
30 days’ prior written notice (or such period of time set forth in the applicable Schedule, if
different) to the relevant Service Provider(s) of such Service or Services for any or no reason;
provided, that such termination does not materially adversely affect the Service Provider or the
members of its Group.




          (c) Any termination notice delivered by any Party shall specify the effective date of
termination and, where applicable, in detail the Service or Services to be terminated.




     SECTION 4.04. Sums Due.



          (a) In the event of a termination (including any termination pursuant to Section 4.02) or
expiration of this Agreement (or Services under one or more Schedules), EWS shall be entitled to
the payment or reimbursement of, and SNI shall, or shall cause the other applicable member(s) of
its Group to, pay and reimburse EWS, on the date of such termination or expiration (i) any amounts
due to any




 - 14 - 









 







EWS Service Provider under this Agreement with respect to the applicable terminated or expired
EWS Service(s) and (ii) any amounts accrued in connection with the provision of the applicable
terminated or expired EWS Service(s) through the date of such termination or expiration but not yet
invoiced by any EWS Service Provider under this Agreement, as if such amounts were invoiced on the
date of such termination or expiration.




          (b) In the event of a termination (including any termination pursuant to Section 4.02) or
expiration of this Agreement (or Services under one or more Schedules), SNI shall be entitled to
the payment or reimbursement of, and EWS shall, or shall cause the other applicable member(s) of
its Group to, pay and reimburse SNI, on the date of such termination or expiration (i) any amounts
due to any SNI Service Provider under this Agreement with respect to the applicable terminated or
expired SNI Service(s) and (ii) any amounts accrued in connection with the provision of the
applicable terminated or expired SNI Service(s) through the date of such termination or expiration
but not yet invoiced by any SNI Service Provider under this Agreement, as if such amounts were
invoiced on the date of such termination or expiration.




     SECTION 4.05. Effect of Termination. Articles I, III, VI, VIII, IX, X and XI and
Sections 4.04 and 4.05 shall survive any termination of this Agreement.



ARTICLE V

THIRD PARTY RIGHTS




     SECTION 5.01. Third Parties and EWS Services.



          (a) EWS and SNI shall cooperate to attempt to obtain all Consents (including those set forth
on Exhibits 5.01 and 5.02) sufficient to enable the EWS Service Providers to
perform the EWS Services in accordance with this Agreement for any third party Software or other
Intellectual Property related to the provision of the EWS Services; provided, that, EWS shall not
be required to incur any costs in connection therewith. SNI shall cooperate with EWS in obtaining
all such required Consents related to the provision of the EWS Services and SNI shall bear any
costs incurred in connection therewith, provided, further, that SNI shall only be required to
reimburse EWS for those expenses incurred by EWS that SNI has previously approved in writing.
Attached hereto as Exhibit 5.01 is a list of required Consents for any third party Software
or other Intellectual Property known to be related to, and necessary for, the provision of the EWS
Services and an estimate of charges to be imposed by third party software providers. In the event
that any such Consent is not obtained, then, unless and until such Consent is obtained, during the
term of the applicable Schedule, the Parties shall cooperate with each other in attempting to
achieve a reasonable alternative arrangement with respect to such third party Software or
Intellectual Property for SNI to continue to process its work and for the EWS Service Providers to
perform the EWS Services. Notwithstanding anything contained in this Agreement, EWS’ obligations
hereunder to provide the EWS Services that require third party Intellectual Property are subject to
such third party granting the applicable members of the EWS Group a valid and enforceable license
(or waiving the requirement to obtain a license) to use its Intellectual Property for the purposes
described herein.




          (b) Nothing contained in this Agreement shall preclude SNI from enforcing any rights or
benefits available to it or EWS, or availing itself of any rights or defenses available to it or
EWS under any third party agreement pursuant to which EWS Services are being provided to SNI.




 - 15 - 









 








     SECTION 5.02. Third Parties and SNI Services.



          (a) EWS and SNI shall cooperate to attempt to obtain all Consents (including those set forth
on Exhibits 5.01 and 5.02) sufficient to enable the SNI Service Providers to
perform the SNI Services in accordance with this Agreement for any third party Software or other
Intellectual Property related to the provision of the SNI Services; provided, that, SNI shall not
be required to incur any costs in connection therewith. EWS shall cooperate with SNI in obtaining
all such required Consents related to the provision of the SNI Services and EWS shall bear any
costs in connection therewith; provided, further, that EWS shall only be required to reimburse SNI
for those expenses incurred by SNI that EWS has previously approved in writing. Attached hereto as
Exhibit 5.02 is a list of required Consents for any third party Software or other
Intellectual Property known to be related to, and necessary for, the provision of the SNI Services
and an estimate of charges to be imposed by third party Software providers. In the event that any
such Consent is not obtained, then, unless and until such Consent is obtained, during the term of
the applicable Schedule, the Parties shall cooperate with each other in attempting to achieve a
reasonable alternative arrangement with respect to such third party Software or Intellectual
Property for EWS to continue to process its work and for the SNI Service Providers to perform the
SNI Services. Notwithstanding anything contained in this Agreement, SNI’s obligations hereunder to
provide the SNI Services that require third party Intellectual Property are subject to such third
party granting the applicable members of the SNI Group a valid and enforceable license (or waiving
the requirement to obtain a license) to use its Intellectual Property for the purposes described
herein.




          (b) Nothing contained in this Agreement shall preclude EWS from enforcing any rights or
benefits available to it or SNI, or availing itself of any rights or defenses available to it or
SNI under any third party agreement pursuant to which SNI Services are being provided to EWS.




ARTICLE VI

INTERNAL CONTROLS




     SECTION 6.01. Access Rights of SNI. If requested by SNI, EWS shall and shall cause
each EWS Service Provider to permit the SNI Group members reasonable access (in addition to the
access required by Section 8.04) to its respective books, records, accountants (and EWS shall
exercise commercially reasonable efforts to provide such access to its accountants’ work papers),
personnel and facilities for the purpose of SNI’s testing and verification of the effectiveness of
each EWS Service Provider’s controls with respect to EWS Services as is reasonably necessary to
enable the management of SNI to comply with its obligations under SOX §404 and to enable SNI’s
independent public accounting firm to attest to and report on the assessment of the management of
SNI in accordance with SOX §404 and Accounting Standard No. 5, as amended, or as required by SNI’s
external auditors; provided, however, that, except as set forth in Section 8.04, EWS shall not be
required to furnish SNI access to any information other than information that relates specifically
to EWS Services.



     SECTION 6.02. Access Rights of EWS. If requested by EWS, SNI shall and shall cause
each SNI Service Provider to permit the EWS Group members reasonable access (in addition to the
access required by Section 8.04) to its respective books, records, accountants (and SNI shall
exercise commercially reasonable efforts to provide such access to its accountants’ work papers),
personnel and facilities for the purpose of EWS’ testing and verification of the effectiveness of
each SNI Service Provider’s controls with respect to SNI Services as is reasonably necessary to
enable the management of EWS to comply with its obligations under SOX §404 and to enable EWS’
independent public accounting firm to attest to and report on the assessment of the management of
EWS in accordance with SOX §404 and Accounting Standard No. 5, as amended, or as required by EWS’
external auditors; provided, however, that, except as set forth in Section 8.04, SNI shall not be
required to furnish EWS access to any information other than Information that relates specifically
to SNI Services.



 - 16 - 









 





     SECTION 6.03. Procedures. Without limiting the generality of, and in order to give
effect to, the foregoing provisions of Article VI:



          (a) the Parties shall cooperate from time to time to identify the significant processes
provided by each Party to the other Party in connection with the provision of the Services
hereunder;




          (b) each Party shall develop and maintain comprehensive procedures to adequately test,
evaluate and document the design and effectiveness of its controls over such significant processes;




          (c) each Party as Service Provider shall provide to the other Party, its auditors and any
third party that such other Party has retained to assist it with its SOX §404 compliance (subject
to such third party’s having signed an appropriate confidentiality agreement with the Party that is
providing the relevant Information), as soon as practical but no later than the 15th day of the
month following each fiscal quarter end during which the Service Provider provided a Service
comprising a significant process to the other Party, adequate documentation with respect to the
testing of its controls over the significant processes;




          (d) in the event any deficiencies are found as a result of the testing, the Service Provider
will notify the Service Recipient of such deficiencies as soon as practical but no later than the
15th day of the month following each fiscal quarter end, and the Service Provider and the Service
Recipient shall cooperate in good faith to develop and implement commercially reasonable action
plans and timetables to remedy such deficiencies and/or implement adequate compensating controls;
provided, however, that if a Party as Service Provider provides a substantially similar service for
itself or its Subsidiaries, then such Party as Service Provider shall not be required to take any
actions that are different from the actions that such Party is taking with respect to such services
that it provides for itself or its Subsidiaries, unless the control deficiency is or could
reasonably be expected to be a material weakness in the Service Recipients’ internal control over
financial reporting (and the Service Recipient shall share its analysis in this regard with the
Service Provider), in which case the Service Provider shall cooperate in good faith with the
Service Recipient to develop and implement in a timely fashion commercially reasonable action plans
and timetables to remedy the deficiency and/or implement adequate compensating controls such that
the deficiency will not rise to the level of a material weakness; provided further, that, if, as a
result of such remedy and/or implementation, the Service Provider is required to take actions that
are different than the actions that the Service Provider is taking with respect to the
substantially similar services that it provides for itself or its Subsidiaries, the Service
Recipient shall be obligated to fund the incremental costs incurred by the Service Provider,
including all out of pocket incremental costs, plus a reasonable allocation of costs of employees
who are diverted from providing services that such employees would otherwise be providing to the
Service Provider during the period of such remedy and/or implementation;




          (e) the Service Provider shall, if requested by the Service Recipient, make its personnel and
testing and documentation available to the auditors of the Service Recipient to enable such
auditors to attest to and report on the assessment of internal control over financial reporting of
the management of the Service Recipient, and the Service Provider shall cooperate and assist the
Service Recipient’s auditors in performing any process walkthroughs and process testing that such
auditor may request of the significant processes; and




          (f) each Party as Service Provider shall provide written notice to the other Party, as soon as
practical but no later than the 15th day of the month following each fiscal quarter end, of any
significant change in control design by such Party or any of its other Group members during any
fiscal quarter during the term of this Agreement.




 - 17 - 









 








ARTICLE VII

TRANSITION TEAMS/SINGLE POINT OF CONTACT




     SECTION 7.01. Appointment of Transition Teams. Each Party shall designate one or more
individuals who have practical knowledge and experience in each area of such Party’s operations
that relate to the Services and are authorized to make decisions with respect to the Services (each
a “Transition Team”). Without limiting the generality of the foregoing, and subject to the
foregoing provision, each Transition Team will include individuals from such Party and its
Subsidiaries whose experience includes, as applicable, the following areas: (i) information
technology systems, (ii) human resources, (iii) accounting and finance, (iv) risk management and
insurance, (v) tax, (vi) corporate development, (vii) financial services center, (viii) treasury,
(ix) payroll, (x) real estate and facilities, (xi) product supplies and (xii) SEC and financial
reporting. Each Party shall designate a member of its Transition Team as the leader of its
respective Transition Team (each a “Team Leader”). The initial members of the Transition
Team and the Team Leader for each of EWS and SNI are set forth on Exhibit 7.01, including
each such person’s title, areas of expertise and relevant telephone, fax and email information.
Each Team Leader shall coordinate the assignment of persons to its Transition Team and shall assess
and monitor the performance of the Transition Services. The Transition Teams will be responsible
for overseeing the completion of the Services in accordance with the terms and conditions hereof.



     SECTION 7.02. Transition Team Actions. The Transition Teams shall convene meetings on
a mutually agreed upon periodic basis as required. It is the expectation of the Parties that the
Transition Team members shall communicate directly with one another and work directly with one
another to ensure that all Transition Services are completed on a timely and complete basis;
provided that, (i) except for EWS’ Team Leader, the members of EWS’ Transition Team shall not have
the legal authority to make or to modify any obligation or to waive any right on behalf of any EWS
Service Provider and (ii) except for a SNI’s Team Leader, the members of SNI’s Transition Team
shall not have the legal authority to make or to modify any obligation or to waive any right on
behalf of any SNI Service Provider. The Team Leaders shall meet on such mutually agreed upon
periodic basis as required, to discuss the status of the Transition Services, as well as to answer
questions, gather information and resolve disputes that may occur from time to time. All meetings
pursuant to this Section 7.02 may be face-to-face, video or telephonic meetings as may be agreed
upon by the individuals participating is such meeting. Each Party shall bear all costs and
expenses of such Party’s Transition Team related to attending or participating in Transition Team
meetings.



ARTICLE VIII

CONFIDENTIALITY; NON-SOLICITATION; RECORDS; ACCESS




     SECTION 8.01. Confidentiality Obligations.



          (a) General. Each Party acknowledges that such Party has in its possession, and in
connection with this Agreement such Party will receive, Information of the other Party that is not
available to the general public and may constitute, contain or include material non-public
Information of the other Party. Subject to Section 8.01(c) and Section 8.01(d), as of the
Distribution Date, each Party, on behalf of itself and each other member of its Group, agrees to
hold, and to cause its respective directors, officers, employees, agents, third-party contractors,
vendors, accountants, counsel and other advisors and representatives to hold, in strict confidence,
with at least the same degree of care that such Party applies to its own confidential and
proprietary Information pursuant to its applicable policies and procedures in effect as of the
Distribution Date, all Information concerning the other Party (or its Business) and the other
members of such other Party’s Group (or their respective Business) that is either in its possession
(including Information in its possession prior to the Distribution Date) or furnished by the other
Party or




 - 18 - 









 







the other members of such other Party’s Group or their respective directors, officers,
employees, agents, third-party contractors, vendors, accountants, counsel and other advisors and
representatives at any time pursuant to this Agreement, and will not use such Information other
than for such purposes as may be expressly permitted hereunder, except, in each case, to the extent
that such Information: (i) is or becomes available to the general public, other than as a result of
a disclosure by such Party or the other members of such Party’s Group or any of their respective
directors, officers, employees, agents, third-party contractors, vendors, accountants, counsel and
other advisors and representatives in breach of this Agreement; (ii) was or becomes available to
such Party or the other members of such Party’s Group on a non-confidential basis from a source
other than the other Party or the other members of such other Party’s Group, provided, that, the
source of such Information was not bound by a confidentiality obligation with respect to such
Information, or otherwise prohibited from transmitting the Information to such Party or the other
members of such Party’s Group by a contractual, legal or fiduciary obligation; or (iii) is
independently generated by such Party or the other members of such Party’s Group without use of or
reference to any proprietary or confidential Information of the other Party.




          (b) No Release, Compliance with Law, Return or Destruction. Following the
Distribution Date, each Party agrees not to release or disclose, or permit to be released or
disclosed, any Information of the other Party to any other Person, except its directors, officers,
employees, agents, third-party contractors, vendors, accountants, counsel, lenders, investors and
other advisors and representatives who need to know such Information pursuant to this Agreement,
and except in compliance with Section 8.01(c). Each Party shall advise its directors, officers,
employees, agents, third-party contractors, vendors, accountants, counsel, lenders, investors and
other advisors and representatives who have been provided with such Information of such Party’s
confidentiality obligations hereunder and that such Information may constitute, contain or include
material non-public Information of the other Party. Following the Distribution Date, each Party
shall, and shall cause, its directors, officers, employees, agents, third-party contractors,
vendors, accountants, counsel, lenders, investors and other advisors and representatives who have
been provided with such Information to use such Information only in accordance with (i) the terms
of this Agreement and (ii) applicable Law (including federal and state securities Laws). Following
the Distribution Date, each Party shall promptly, after receiving a written request of the other
Party, return to the other Party all such Information in a tangible form (including all copies
thereof and all notes, extracts or summaries based thereon) or certify to the other Party that it
has destroyed such Information (and such copies thereof and such notes, extracts or summaries based
thereon), as directed by the other Party.




          (c) Protective Arrangements. Notwithstanding anything herein to the contrary, in the
event that, following the Distribution Date, either Party or any of its directors, officers,
employees, agents, third-party contractors, vendors, accountants, counsel, lenders, investors and
other advisors and representatives either determines on the advice of its counsel that it is
required to disclose any Information of the other Party pursuant to applicable Law or the rules or
regulations of a Governmental Authority or receives any demand under lawful process or from any
Governmental Authority to disclose or provide Information of the other Party that is subject to the
confidentiality provisions hereof, such Party shall, if possible, notify the other Party prior to
disclosing or providing such Information and shall cooperate at the expense of the requesting Party
in seeking any reasonable protective arrangements requested by such other Party. In the event that
a protective arrangement is not obtained, the Person that received such request (i) may thereafter
disclose or provide such Information to the extent required by such Law (as so advised by counsel)
or by lawful process or such Governmental Authority, without liability therefor and (ii) shall
exercise its commercially reasonable efforts to have confidential treatment accorded any such
Information so furnished.




 - 19 - 









 








          (d) Certain Standards and Exceptions.





          (i) Nothing in this Agreement shall be construed to limit or prohibit either Party from
independently creating or developing (or having created or developed for it), or from
acquiring from third parties (or from thereafter using or disclosing as such Party sees
fit), any Information similar to or competitive with the Information contemplated by or
embodied in the other Party’s confidential, non-public and proprietary Information, provided
that in connection with such creation, development, or acquisition such Party does not
violate any of its obligations under this Agreement or any other agreement with the other
Party. Notwithstanding the foregoing, neither Party shall, nor shall it assist others to,
disassemble, decompile, reverse engineer, or otherwise attempt to recreate, the other
Party’s confidential, non-public and proprietary Information.




          (ii) Nothing in this Agreement shall limit either Party’s ability to market, develop
and provide products or services to others that are functionally comparable to those of the
other Party, whether or not based on the same general business practices, concepts,
techniques and routines contemplated by or embodied in the other Party’s confidential,
non-public and proprietary Information.




          (iii) “Residuals” means Information retained in the memory of an employee of one Party
pertaining to or resulting from the performance of services for the other Party, excluding,
however, Information deliberately memorized to classify it as Residuals. Notwithstanding
anything to the contrary in this Section 8.01, either Party shall be free to use for any
purpose Residuals of its employees resulting from their access to or work with Information
of the other Party if such Party otherwise complies with its obligations not to disclose
Information of the other Party to third parties in violation of this Section 8.01; provided,
that this provision does not grant either Party a license to use the other Party’s
Intellectual Property.



     SECTION 8.02. Non-Solicitation.



          (a) For a period of two years from the Distribution Date, neither SNI nor any other member of
the SNI Group shall, without the prior written approval of EWS, directly or indirectly, solicit any
employees of any EWS Service Provider who are engaged in or were engaged in providing Services
during the term of this Agreement, to terminate their relationship with any of the EWS Service
Providers. The foregoing shall not apply to any solicitation of any employee or employment of any
employee of any EWS Service Provider who (i) initially contacted any member of the SNI Group or
their representatives on his or her own initiative without any solicitation by any member of the
SNI Group or their representatives, (ii) responded to a solicitation directed at the public in
general through advertisement or similar means not targeted specifically at such employee or the
business of the EWS Service Provider or (iii) was referred to any member of the SNI Group or their
representatives, as applicable, by search firms, employment agencies or other similar entities
provided that such entities have not been specifically instructed by any member of the SNI Group or
their representatives to solicit such employee.




          (b) For a period of two years from the Distribution Date, neither EWS nor any other member of
the EWS Group shall, without the prior written approval of SNI, directly or indirectly, solicit any
employees of any SNI Service Provider who are engaged in or were engaged in providing Services
during the term of this Agreement, to terminate their relationship with any of the SNI Service
Providers. The foregoing shall not apply to any solicitation of any employee or employment of any
employee of any SNI Service Provider who (i) initially contacted any member of the EWS Group or
their representatives on his or her own initiative without any solicitation by any member of the
EWS Group or their representatives, (ii) responded to a solicitation directed at the public in
general through advertisement or




 - 20 - 









 







similar means not targeted specifically at such employee or the business of the SNI Service
Provider or (iii) was referred to any member of the EWS Group or their representatives, as
applicable, by search firms, employment agencies or other similar entities provided that such
entities have not been specifically instructed by any member of the EWS Group or their
representatives to solicit such employee.




     SECTION 8.03. Records. Each Party shall maintain records with respect to the Services
provided by such Party that are in a form and contain a level of detail similar to records, if any,
that are maintained in providing similar services for itself or for such Party’s Subsidiaries for a
period of the longer of one year after the termination of this Agreement or the applicable period
for maintaining such records set forth in the EWS Record Retention Policy in effect as of the
Distribution Date, or such longer period as required by applicable Law. During the period in which
such Party is required to maintain such records, upon prior written request to such Party, the
other Party and its Subsidiaries shall have reasonable access to such records during normal
business hours of such Party or its applicable Subsidiary at the place where such records are
normally maintained.



     SECTION 8.04. Access.



          (a) SNI shall, and shall cause the other applicable members of the SNI Group to, make
available on a timely basis to each EWS Service Provider such Information reasonably requested by
such EWS Service Provider to enable such EWS Service Provider to provide the EWS Services. SNI
shall, and shall cause the other applicable members of the SNI Group to, provide to the EWS Service
Providers reasonable access to the premises of the SNI Group members and the systems, software and
networks located therein, to the extent necessary for the purpose of providing the EWS Services.
EWS shall ensure that it and the other EWS Service Providers comply with applicable Law and SNI’s
security and other policies and procedures, as may be provided to EWS by SNI in writing from time
to time. At EWS’ request, SNI agrees to, or to cause the applicable SNI Service Provider to: (i)
maintain logs of activity of its employees and contractors when providing Services that are billed
to the Service Recipient on a hourly basis with respect to any of such SNI Service Provider’s
systems or databases and (ii) if there is a dispute between the Parties regarding any such
Services, allow EWS to audit such SNI Service Provider’s usage by employees and contractors with
respect to such systems and databases.




          (b) EWS shall, and shall cause the other applicable members of the EWS Group to, make
available on a timely basis to each SNI Service Provider such Information reasonably requested by
such SNI Service Provider to enable such SNI Service Provider to provide the SNI Services. EWS
shall, and shall cause the other applicable members of the EWS Group to, provide to the SNI Service
Providers reasonable access to the premises of the EWS Group members and the systems, software and
networks located therein, to the extent necessary for the purpose of providing the SNI Services.
SNI shall ensure that it and the other SNI Service Providers comply with applicable Law and EWS’
security and other policies and procedures, as may be provided to SNI by EWS in writing from time
to time. At SNI’s request, EWS agrees to, or to cause the applicable EWS Service Provider to: (i)
maintain logs of activity of its employees and contractors when providing Services that are billed
to the Service Recipient on a hourly basis with respect to any of such EWS Service Provider’s
systems or databases and (ii) if there is a dispute between the Parties regarding any such
Services, allow SNI to audit such EWS Service Provider’s usage by employees and contractors with
respect to such systems and databases.




 - 21 - 









 








ARTICLE IX

NO WARRANTY; LIMITATION OF LIABILITY;

INDEMNIFICATION




     SECTION 9.01. Warranties and Disclaimer of Warranty by EWS.



          (a) EWS represents and warrants to SNI as of the date hereof and at all times during which the
EWS Services are provided to SNI, that:




          (i) Subject to the receipt of the Consents set forth on Exhibit 5.01 hereof,
neither the provision of the EWS Services by any EWS Service Provider, nor the receipt or
use thereof by SNI in accordance with the terms and conditions hereof, shall breach,
violate, infringe upon or constitute misappropriation of any Intellectual Property right of
any Person. Subject to the terms and conditions hereof, of the Separation Agreement and of
the other Ancillary Agreements, the provision of the EWS Services will not confer on SNI any
Intellectual Property rights, except as explicitly provided herein or therein.




          (ii) The EWS Services will be performed in a timely manner consistent with this
Agreement, as each individual Schedule may require, by qualified individuals with
appropriate subject matter expertise, in a professional and workmanlike manner, conforming
to generally accepted industry standards and practices applicable to each individual
Schedule and in strict accordance with all applicable Laws.



          (b) Except as expressly set forth in this Agreement, the EWS Services to be purchased under
this Agreement are provided as is, where is, with all faults, and without warranty or condition of
any kind, express or implied, including any warranty of merchantability or fitness for any
particular purpose or any other warranty whatsoever.




     SECTION 9.02. Warranties and Disclaimer of Warranty by SNI.



          (a) SNI represents and warrants to EWS as of the date hereof and at all times during which the
SNI Services are provided to EWS, that:





          (i) Subject to the receipt of the Consents set forth on Exhibit 5.02 hereof,
neither the provision of the SNI Services by any SNI Service Provider, nor the receipt or
use thereof by EWS in accordance with the terms and conditions hereof, shall breach,
violate, infringe upon or constitute misappropriation of any Intellectual Property right of
any Person. Subject to the terms and conditions hereof, of the Separation Agreement and of
the other Ancillary Agreements, the provision of the SNI Services will not confer on EWS any
Intellectual Property rights, except as explicitly provided herein or therein.




          (ii) The SNI Services will be performed in a timely manner consistent with this
Agreement, as each individual Schedule may require, by qualified individuals with
appropriate subject matter expertise, in a professional and workmanlike manner, conforming
to generally accepted industry standards and practices applicable to each individual
Schedule and in strict accordance with all applicable Laws.



          (b) Except as expressly set forth in this Agreement, the SNI Services to be purchased under
this Agreement are provided as is, where is, with all faults, and without warranty or condition of
any kind, express or implied, including any warranty of merchantability or fitness for any
particular purpose or any other warranty whatsoever.




 - 22 - 









 








     SECTION 9.03. Obligation to Re-perform EWS Services. In the event of any breach of
this Agreement by any EWS Service Provider with respect to any failure by an EWS Service Provider
to provide any EWS Service in accordance with the terms of this Agreement, EWS shall, or shall
cause the applicable EWS Service Provider to, correct in all material respects such error or defect
or re-perform in all material respects such EWS Service at the request of SNI and at the expense of
EWS. To be effective, any such request by SNI must (i) specify in reasonable detail the particular
error or defect and (ii) be made no more than 90 days from the date such error or defect was
discovered by SNI or should have been discovered by SNI after reasonable inquiry.



     SECTION 9.04. Obligation to Re-perform SNI Services. In the event of any breach of
this Agreement by any SNI Service Provider with respect to any failure by an SNI Service Provider
to provide any SNI Service in accordance with the terms of this Agreement, SNI shall, or shall
cause the applicable SNI Service Provider to, correct in all material respects such error or defect
or re-perform in all material respects such SNI Service at the request of EWS and at the expense of
SNI. To be effective, any such request by EWS must (i) specify in reasonable detail the particular
error or defect and (ii) be made no more than 90 days from the date such error or defect was
discovered by EWS or should have been discovered by EWS after reasonable inquiry.



     SECTION 9.05. Limitation of Liability. Notwithstanding anything contained herein to
the contrary:



          (a) In no event shall either Party be liable to the other Party or its Group (or their
respective directors, officers, agents, Service Providers or employees) for incidental,
consequential or punitive damages in connection with this Agreement, even if the Party has been
advised of the possibility of such damages, and each Party hereby waives on behalf of itself, its
Affiliates, and Service Providers and their respective directors, officers, agents, Service
Providers or employees any claim for such damages including any claim for lost profits, whether
arising in contract, tort or otherwise;




          (b) EWS will exercise commercially reasonable due diligence in its choice of such Third Party
Service Provider and EWS will employ Best Efforts to induce or cause such Third Party Service
Provider to provide the EWS Services in accordance with the manner and levels agreed to hereunder;
and




          (c) SNI will exercise commercially reasonable due diligence in its choice of such Third Party
Service Provider and SNI will employ Best Efforts to induce or cause such Third Party Service
Provider to provide the SNI Services in accordance with the manner and levels agreed to hereunder.




     SECTION 9.06. EWS Indemnity. EWS shall indemnify and hold harmless SNI and the other
members of the SNI Group (and their respective directors, officers, agents, Third Party Service
Providers and employees) from and against any and all claims, demands, complaints, damages,
payments, losses, liabilities, costs or expenses (each of the foregoing, a “Loss”) arising
out of, relating to or in connection with (i) any Action pursuant to which it has been determined
that the provision by any EWS Service Provider and/or the receipt by any member of the SNI Group of
any EWS Service infringes upon or misappropriates the Intellectual Property of any third party, to
the extent that any such Loss is determined to have resulted from such EWS Service Provider’s
intentional breach, fraud, gross negligence or willful misconduct, (ii) any breach by EWS of its
obligations under this Agreement or (iii) any action or omission by an EWS Service Provider in
providing the EWS Services hereunder, except to the extent any such Loss arises from the acts or
omissions of a member of the SNI Group.



 - 23 - 









 





     SECTION 9.07. SNI Indemnity. SNI shall indemnify and hold harmless EWS and the other
members of the EWS Group (and their respective directors, officers, agents, Third Party Service
Providers and employees) from and against any and all Losses arising out of, relating to or in
connection with (i) any Action pursuant to which it has been determined that the provision by any
SNI Service Provider and/or the receipt by any member of the EWS Group of any SNI Service infringes
upon or misappropriates the Intellectual Property of any third party, to the extent that any such
Loss is determined to have resulted from such SNI Service Provider’s intentional breach, fraud,
gross negligence or willful misconduct, (ii) any breach by SNI of its obligations under this
Agreement or (iii) any action or omission by an SNI Service Provider in providing the SNI Services
hereunder, except to the extent any such Loss arises from the acts or omissions of a member of the
EWS Group.



ARTICLE X

DISPUTE RESOLUTION




     SECTION 10.01. General. Except with respect to injunctive relief described below, any
controversy or claim arising out of or relating to this Agreement, or the breach thereof, shall
attempt to be settled first, by good faith efforts of the Parties to reach mutual agreement, and
second, if mutual agreement is not reached to resolve the dispute, by final, binding arbitration as
set out below.



     SECTION 10.02. Initiation. A Party that wishes to initiate the dispute resolution
process shall send written notice to the other Party, in accordance with Section 11.01, with a
summary of the controversy and a request to initiate these dispute resolution procedures. Each
Party shall appoint a knowledgeable, responsible representative who has the authority to settle the
dispute, to meet and to negotiate in good faith to resolve the dispute. The discussions shall be
left to the discretion of the representatives who may utilize other alternative dispute resolution
procedures such as mediation to assist in the negotiations. Discussions and correspondence among
the representatives for purposes of these negotiations (a) shall be treated as Information subject
to the provisions of Section 8.01 developed for purposes of settlement, (b) shall be exempt from
discovery and production and (c) shall not be admissible in the arbitration described above or in
any lawsuit pursuant to Rule 408 of the Federal Rules of Evidence. Documents identified in or
provided with such communications that are not prepared for purposes of the negotiations are not so
exempted and may, if otherwise admissible, be admitted in evidence in the arbitration or lawsuit.
The Parties agree to pursue resolution under this subsection for a minimum of 30 calendar days
before requesting arbitration.



     SECTION 10.03. Arbitration Request. If the dispute is not resolved under the
preceding subsection within 30 calendar days of the initial written notice, either Party may demand
arbitration by sending written notice to the other Party. The Parties shall promptly submit the
dispute to the American Arbitration Association for resolution by a single neutral arbitrator
acceptable to both Parties, as selected under the rules of the American Arbitration Association.
The dispute shall then be administered according to the American Arbitration Association’s
Commercial Arbitration Rules, with the following modifications: (i) the arbitration shall be held
in a location mutually acceptable to the parties, and, if the parties do not agree, the location
shall be Cincinnati, Ohio; (ii) the arbitrator shall be licensed to practice law; (iii) the
arbitrator shall conduct the arbitration as if it were a bench trial and shall use, apply and
enforce the Federal Rules of Evidence and Federal Rules of Civil Procedure; (iv) except for
breaches related to Information subject to Section 8.01, the arbitrator shall have no power or
authority to make any award that provides for consequential, punitive or exemplary damages or
extend the term hereof; (v) the arbitrator shall control the scheduling so that the hearing is
completed no later than 30 calendar days after the date of the demand for arbitration; and (vi) the
arbitrator’s decision shall be given within five calendar days thereafter in summary form that
states the award, without written decision, which decision shall follow the plain meaning of this
Agreement, and in the event of any ambiguity, the intent of the parties. Judgment on the award
rendered by the arbitrator may be entered in any court having jurisdiction over the



 - 24 - 









 




Parties. Each Party to the dispute shall bear its own expenses arising out of the
arbitration, except that the Parties shall share the expenses of the facilities to conduct the
arbitration and the fees of the arbitrator equally.




     SECTION 10.04. Injunctive Relief. The foregoing notwithstanding, each Party shall
have the right to seek injunctive relief in an applicable court of law or equity to preserve the
status quo pending resolution of the dispute and enforce any decision relating to the resolution of
the dispute.



ARTICLE XI

MISCELLANEOUS




     SECTION 11.01. Notices. All notices, requests, claims, demands and other
communications hereunder (except for routine communications contemplated by certain Schedules) must
be in writing and will be deemed to have been duly given only if delivered personally or by
facsimile transmission or mailed (first class postage prepaid) to the Parties at the following
addresses or facsimile numbers:



If to EWS, to:



The E.W. Scripps Company

312 Walnut Street

Cincinnati, Ohio 45202

Facsimile: (513) 977-3884

Attention: Lisa A. Knutson, Senior Vice President of Human Resources




with a copy to:



The E.W. Scripps Company

312 Walnut Street

Cincinnati, Ohio 45202

Facsimile: (513) 977-3042

Attention: William Appleton, Senior Vice President and General Counsel




If to SNI, to:



Scripps Networks Interactive, Inc.

312 Walnut Street

Cincinnati, Ohio 45202

Facsimile: (513) 977-3922

Attention: Patrick Browning, Executive Director of Vendor and Program Management




with a copy to:



Scripps Networks Interactive, Inc.

312 Walnut Street

Cincinnati, Ohio 45202

Facsimile: (513) 977-5166

Attention: Anatolio B. Cruz III, Executive Vice President, Chief
Legal Officer and Corporate Secretary



All such notices, requests and other communications will (i) if delivered personally to the address
as provided in this section, be deemed given upon delivery, (ii) if delivered by facsimile
transmission to the




 - 25 - 









 







facsimile number as provided in this section, be deemed given upon receipt and (iii) if delivered
by mail in the manner described above to the address as provided in this section, be deemed given
upon receipt (in each case regardless of whether such notice, request or other communication is
received by any other Person to whom a copy of such notice, request or other communication is to be
delivered pursuant to this section). Any party from time to time may change its address, facsimile
number or other information for the purpose of notices to that party by giving notice specifying
such change to the other party.




     SECTION 11.02. Entire Agreement. This Agreement, together with all exhibits and
Schedules hereto, the Separation and Distribution Agreement and the other Ancillary Agreements,
constitute the entire agreement of the parties with respect to the subject matter hereof and shall
supersede all previous negotiations, commitments and writings with respect to such subject matter.



     SECTION 11.03. Waiver. Any term or condition of this Agreement may be waived at any
time by the Party that is entitled to the benefit thereof, but no such waiver shall be effective
unless set forth in a written instrument duly executed by or on behalf of the Party waiving such
term or condition. No waiver by any Party of any term or condition of this Agreement, in any one
or more instances, shall be deemed or construed as a waiver of the same or any other term or
condition of this Agreement on any future occasion. All remedies, either under this Agreement or
by Law or otherwise afforded, will be cumulative and not alternative.



     SECTION 11.04. Amendment. This Agreement may be amended, modified, waived,
supplemented or superseded, in whole or in part, only by a written instrument signed by duly
authorized signatories of the Parties.



     SECTION 11.05. Independent Contractors. In performing the Services hereunder, each
Service Provider shall operate as and have the status of an independent contractor. No Service
Provider’s employees shall be considered employees or agents of the other Party, nor shall the
employees of any Party be eligible or entitled to any benefits, perquisites or privileges given or
extended to any of the other Party’s employees in connection with the provision of Services.
Nothing contained in this Agreement shall be deemed or construed to create a joint venture or
partnership between the Parties. No Party shall have any power to control the activities and/or
operations of the other Party. No Party shall have any power or authority to bind or commit any
other Party.



     SECTION 11.06. No Third Party Beneficiary. The terms and provisions of this Agreement
are intended solely for the benefit of each Party hereto and their respective Affiliates,
successors or permitted assigns, and it is not the intention of the Parties to confer third party
beneficiary rights upon any other Person except as provided in Sections 9.06 and 9.07 of this
Agreement.



     SECTION 11.07. No Assignment; Binding Effect. Neither Party shall be permitted to
assign, in whole or in part, directly or indirectly, by operation of law or otherwise, any of its
rights or obligations under this Agreement without the prior written consent of the other Party and
any unauthorized assignment shall be null and void. Notwithstanding such prohibition on
assignment:



          (a) Either Party’s obligation to provide, or right to receive, any Service (or portions
thereof) may be assigned, sublicensed, delegated, allocated or contributed, in whole or in part, to
one or more Affiliates of such Party within its Group and, to the extent so assigned, sublicensed,
delegated, allocated or contributed, the relevant Affiliate shall be deemed the relevant Service
Provider or Service Recipient, as applicable, with respect to the relevant portion of such
Services; provided that no such assignment, allocation or contribution shall relieve such Party of
any of its obligations hereunder. No prior written consent shall be required with respect to any
such permitted assignment, sublicense, delegation, allocation or contribution.




 - 26 - 









 








          (b) Nothing herein shall prohibit, modify or limit the ability of the Parties to transfer or
allocate assets and liabilities, as the case may be, to any entity within the EWS Group or the SNI
Group in connection with, or in furtherance of, the Separation (as defined in the Separation
Agreement) and, to the extent that any such transfer or allocation results in a change of the Party
or member of its Group which reasonably should be a Service Provider or Service Recipient with
respect to any Service then the Parties shall make such amendments, revisions or modifications to
the Schedules as are reasonably necessary to reflect the appropriate Service Provider or Service
Recipient, as the case may be.




          (c) Either Party may assign all, but not less than all, of its rights or obligations under
this Agreement in connection with a consolidation or merger transaction in which such Party is not
the continuing or surviving entity or the sale by such Party of all or substantially all of its
properties and assets, provided that: (i) prior to such transaction becoming effective, the
continuing, surviving or acquiring entity shall have executed and delivered to the other Party a
written agreement, in form and substance reasonably satisfactory to the other Party, pursuant to
which such entity agrees to be bound by all of the terms, conditions and provisions of this
Agreement as if named as a “Party” hereto and (ii) no Service Provider or Service Recipient shall
be obligated to materially change the nature, scope or volume of the Services it provides or
receives, respectively, under this Agreement as a result of any such assignment.




          (d) If either Party assigns, delegates, sublicenses, allocates or contributes all or any
portion of its rights and obligations under this Agreement to any other member of its Group, then
prior to such Party consummating any sale or transfer of a controlling interest in, or all or
substantially all of the properties and assets of, such other Group member to a non-Affiliate of
such Party, such Party shall cause all such rights or obligations to be reallocated among one or
more of the continuing members of its Group by appropriate assignment or assumption transactions
such that the Group member to be sold shall no longer be a Service Provider or Service Recipient
upon consummation of such sale transaction. The other Party shall have the right to prior review
of such re-allocations and the Parties shall cooperate in good faith to resolve any reasonable
objections that the other Party may have to such re-allocations and to take such further actions as
may be reasonably required to assure that the rights and obligations under this Agreement are
preserved, in the aggregate.




          (e) Nothing in this Section 11.07 shall affect the ability of either Party to terminate any of
the Services in accordance with the provisions of this Agreement.




     SECTION 11.08. Headings. The headings used in this Agreement have been inserted for
convenience of reference only and do not define or limit the provisions hereof.



     SECTION 11.09. Submission to Jurisdiction; Waivers. Subject to the prior exhaustion
of the escalation procedures set forth in Article X and to the fullest extent permitted by
applicable Law, each Party hereto (i) agrees that any claim, action or proceeding by such party
seeking any relief whatsoever arising out of, relating to or in connection with, this Agreement or
the transactions contemplated hereby shall be brought only in the United States District Court for
the Southern District of Ohio or any Ohio State court, in each case, located in the County of
Hamilton and not in any other State or Federal court in the United States of America or any court
in any other country, (ii) agrees to submit to the exclusive jurisdiction of such courts located in
the County of Hamilton for purposes of all legal proceedings arising out of, or in connection with,
this Agreement or the transactions contemplated hereby, (iii) waives and agrees not to assert any
objection that it may now or hereafter have to the laying of the venue of any such action brought
in such a court or any claim that any such action brought in such a court has been brought in an
inconvenient forum, (iv) agrees that mailing of process or other papers in connection with any such
action or proceeding in the manner provided in Section 11.01 or any other manner as may be
permitted by Law shall be valid and sufficient service thereof and (v) agrees that a final judgment
in any such action or



 - 27 - 









 




proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the
judgment or in any other manner provided by applicable Law.




     SECTION 11.10. Severability. If any provision of this Agreement is held to be
illegal, invalid or unenforceable under any present or future Law, the remaining provisions of this
Agreement will remain in full force and effect and will not be affected by the illegal, invalid or
unenforceable provision or by its severance herefrom.



     SECTION 11.11. Governing Law. This Agreement and any dispute arising out of, in
connection with or relating to this Agreement shall be governed by and construed in accordance with
the Laws of the State of Ohio, without giving effect to the conflicts of laws principles thereof.



     SECTION 11.12. Counterparts. This Agreement may be executed in any number of
counterparts, each of which will be deemed an original, but all of which together will constitute
one and the same instrument.



     SECTION 11.13. Order of Precedence. In the event of an inconsistency or conflict
between this Agreement and a Schedule or an attachment or exhibit thereto, the Schedule (or the
attachment or exhibit thereto) shall prevail.



     SECTION 11.14. Ownership of and License to Data.



          (a) It is acknowledged and agreed that (i) EWS retains all right, title and interest in and to
all EWS Data and nothing herein shall create or vest in SNI any right, title or interest in or to
the EWS Data and (ii) SNI retains all right, title and interest in and to all SNI Data and nothing
herein shall create or vest in EWS any right, title or interest in or to the SNI Data.




          (b) EWS hereby grants to SNI a non-exclusive, royalty free, fully paid-up, non-transferable,
worldwide license to use EWS Data solely (i) to provide the SNI Services and (ii) to comply with
SNI’s obligations under applicable Law with respect to such EWS Data.




          (c) SNI hereby grants to EWS a non-exclusive, royalty free, fully paid-up, non-transferable,
worldwide license to use SNI Data solely (i) to provide the EWS Services and (ii) to comply with
EWS’ obligations under applicable Law with respect to such SNI Data.




[signature page follows]




 - 28 - 









 








     IN WITNESS WHEREOF, the Parties have caused this Agreement to be duly executed as of the date
first above written.



	 	 	 	 	 
	 	THE E.W. SCRIPPS COMPANY

 	 
	 	By:  	/s/ Richard A. Boehne
 	 
	 	 	Richard A. Boehne, President and Chief Executive Officer 	 



	 	 	 	 	 
	 	SCRIPPS NETWORKS INTERACTIVE, INC.

 	 
	 	By:  	/s/ Joseph G. NeCastro
 	 
	 	 	Joseph G. NeCastro, Executive Vice President and 

Chief Financial Officer 	 
	 	 	 	 
	 




 - 29 -